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North & Central America and Caribbean
Grenada |
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Last reviewed: 04 June 2009 |
Country information
ECONOMY
Basic Economic Facts
GDP (2007): US$485 million
GDP per head (2007): US$4,572
Real GDP annual growth at factor cost (2007): 4.3% (EIU)
Inflation: 3.9% in 2007 (EIU)
The main sources of employment in Grenada are agriculture, construction and tourism. Tourism is Grenada's main foreign exchange earner. The global economic crisis has weaked the economic outlook and tourism demand is expected to weaken further. Remittances are expected to slow down. Annual inflatioin is projected to decline to 4% in 2009, owing to lower global commodity prices. The banking sector is expected to remain resilient, notwithstanding the international financial turmoil, and based on the performance to date of their primarily Canadian parent banks. Some service industries show growth potential, including offshore medical schools, which already play an important economic role in Grenada.
The main export and principal crop is nutmeg but banana, cocoa and fish exports also contribute to the economy. The importance of agriculture has been reduced over the last decade with natural disasters, declining international prices and disease affecting this sector. The Ministry of Agriculture has developed a National Strategy to address the decline in people working in the agriculture sector. Banana growers have benefited by a growing niche market for Fair Trade crops within the UK market, so the sector is expected to survive in the medium term, although this is partly dependent upon the outcome of a challenge within the WTO by Ecuador on the EU import regime. However, overall agriculture is likely to remain weak for the foreseeable future.
Unemployment, particularly among the youth population, remains high.
Hurricane Ivan
Hurricane Ivan - the worst for 49 years - hit Grenada in September 2004, causing massive damage and destruction. In addition to the dead and injured, 50% of the population were estimated to have lost their homes with 90% of housing stock damaged.
